Jack Grimes Started a Consulting Business, Grimes Consulting, on January $=$

question 40

Essay

Jack Grimes started a consulting business, Grimes Consulting, on January 1, 2013 by issuing $7,000 of common stock. In addition, the following events occurred in 2013.
Provided services on account, $25,500.
Paid cash for $11,500 in operating expenses.
Collected $9,000 of the revenue that was previously recorded on account.
Paid a cash dividend of $4,000 to the stockholders.
Required:
a) Show the effects of the above transactions on the accounting equation. Assets $=$ Liabilities $+$ Common Stock $+$ Retained Earnings
1)
2)
3)
4)
5)
b) Prepare an income statement and statement of cash flows for 2013.

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Definitions:

Depressant

A substance that slows down the nervous system and can lead to decreased alertness, often used to treat insomnia, anxiety, or other mental health conditions.

Stimulant

Substances that increase alertness, attention, and energy by accelerating the activity of the central nervous system.

DSM-5

The fifth edition of the American Psychiatric Association's classification and diagnostic tool for mental health professionals.

Substance Use

The consumption of drugs or alcohol, not necessarily implying abuse, but focusing on the act of using these substances.